Requirements

As mentioned above the expected requirement is an SQL database with IPs. Most statistics plug-ins will keep track of that (f.e. Counterize). On a technical level I think PHP5 should do the trick. IPCCP is not using any WordPress specific calls and should work with any version (tested up to 2.3.2).

[Note:] Running IPCCP on a large data set might require some calculation time, which could exceed the maximum PHP execution time (usually 30sec). Therefore IPCCP can try to extend this execution time, which will require the server to not run in PHP safemode. Check with you friendly system administer if you don't have the appropriate access level. It took more than 5 minutes to generate the picture above (admittedly on my ancient webserver - but you get the point).

Setup

Setup itself is the usual 1-2-3 of downloading, expanding into /wordpress/wp-content/plugins and activating. Check the IPCCP options panel in the admin section and set those values to your liking. You'll see a first preview there. Provided are both the direct function call (for sidebar's, footer and such) <?php if(function_exists(ipccp)) ipccp(); ?> and the token word access [IPCCP] for posts or pages. You might want to check MaxMinds website once in a while, as they offer monthly updates to their database. Simply download the GeoLiteCity databases and drop them into the GeoIP folder within the IPCCP plug-in folder.

[Note:] Make sure the webserver has write permissions on those files:
/wordpress/wp-content/plugins/ipccp/images/ipccp_out*

[Note:] You could also add
anywhere in your template to activate the reclustering. Use carefully though!